JOHN FAIRHURST.
Policy and External Affairs Director, PayPlan
Dealing with priority debts is an increasingly pressing
issue for many of our clients.
We are seeing more and more people who do not
have enough money to pay for essential bills like
council tax and utility bills, and these tend to be
clients who simply don’t have enough income to
support their day-to-day expenditure.
The issue is less often about how to deal with priority
debts (which remains straightforward for clients with a
reasonable surplus income) and more about how to deal
with the underlying budget deficit. Priority debt problems
are usually a symptom of that deeper problem.
If we’re asking, ‘is debt advice sufficient to fix that?’
or ‘do we just need a new debt solution or better
forbearance?’ then the answer is mainly ‘no’. The
problem is less about lack of a suitable solution,
more about a lack of sufficient income.
Debt advice can still be enormously helpful for
people with a deficit budget – traditional advice
tools like budgeting help, income maximisation
and help with prioritising repayments can ease
stress and pressures on household budgets.
Helping people understand the options open to
them represents a real step forward. Inevitably
though, we are seeing a growing number of cases
where there are no ‘good’ options. Where the only
way to balance a budget is via significant (and
often unpalatable) lifestyle change.
Engaging with these clients who, not unreasonably,
can feel there is no ‘answer’ to their problems remains
a challenge. We need to think carefully about how
debt advice is promoted to this group – the value we
can offer is more about the process than easy fixes or
solutions and our communications should reflect this.
“THE ISSUE IS LESS OFTEN ABOUT HOW
TO DEAL WITH PRIORITY DEBTS AND
MORE ABOUT HOW TO DEAL WITH
THE UNDERLYING BUDGET DEFICIT.”
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